K-Fast

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES, AUSTRALIA, CANADA, HONG KONG, JAPAN, NEW ZEELAND, SINGAPORE, SOUTH AFRICA, SOUTH KOREA OR ANY OTHER JURISDICTION WHERE SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. OTHER RESTRICTIONS ARE APPLICABLE, PLEASE REFER TO “DISCLAIMER” AT THE END OF THIS PRESS RELEASE.

K-Fast Holding AB (publ) (”K-Fastigheter” or the ”Company”) is investigating the possibility to carry out a directed issue of series B shares corresponding to approximately SEK 350 million through an accelerated book-building procedure targeting Swedish and international institutional investors (the ”Directed Issue”), starting immediately. The Company has engaged Nordea Bank Abp, filial i Sverige (“Nordea”) and Swedbank AB (publ) (“Swedbank”) as Joint Global Coordinators and Joint Bookrunners.

The Directed Issue

The Directed Issue is intended to be carried out with deviation from the shareholders' preferential rights and pursuant to the authorization to issue shares granted by the Annual General Meeting held on 15 May 2023. The subscription price and the number of newly issued shares in the Directed Issue will be determined through an accelerated book-building procedure that will begin immediately after the announcement of this press release and carried out by Nordea and Swedbank. Completion of the accelerated book-building procedure, pricing and allocation of new shares is expected to take place before trading begins on Nasdaq Stockholm at 09.00 CEST on 29 September 2023. The time for closing, pricing and allocation in connection with the book-building procedure is determined by the Company, and the Company may at any time shorten, extend or cancel the book-building procedure, meaning the Company may refrain, in part or in full, from carrying out the Directed Issue. The Company will announce the outcome of the Directed Issue through a press release after the book-building procedure has been completed.

K-Fastigheter’s investigation of the conditions for carrying out the Directed Issue is part of creating the conditions for continued expansion through the acquisition of building rights and construction start of new projects. The Company is continuously assessing various alternatives to ensure that K-Fastigheter can maintain a solid expansion rate and take advantage of attractive opportunities that may arise to acquire suitable building rights intended for K-Fastigheter’s construction of residential properties. The net cash from the Directed Issue is intended to, by strengthening the financial position, which initially includes reducing short-term loan financing, increase the capabilities to, and enable investments in, construction start of additional projects and acquisition of building rights.

Prior to the Directed Issue, the board of directors of the Company has made an overall assessment and carefully considered the possibility to raise capital through a rights issue with preferential right for the Company’s shareholders. The board of directors considers that the reasons for deviating from the shareholders’ preferential right are (i) that a rights issue would take a significantly longer time to complete and entail a higher risk for an adverse effect on the share price, particularly in light of the current market volatility and the challenging market conditions, (ii) to diversify and strengthen the Company’s shareholder base with institutional investors, and (iii) to carry out a directed share issue can be made at lower costs and with less complexity than a rights issue. Considering the above, the board of directors has made the assessment that a directed issue of series B shares with deviation from the shareholders’ preferential right is the most favourable alternative for K-Fastigheter to carry out the capital raise. 

Since the subscription price in the Directed Issue will be determined through an accelerated book-building procedure, the board of directors considers the subscription price to reflect market terms and conditions.

To support the Company’s efforts in achieving the necessary subscription in the Directed Issue within the framework of the book-building procedure, Erik Selin Fastigheter AB, which owns approximately 34.8 per cent. of the shares and 39.3 per cent. of the votes in the Company, has declared its intention to support the share issue. Erik Selin Fastigheter AB is owned by Erik Selin, who is Chairman of the board of directors of K-Fastigheter, and Erik Selin Fastigheter AB is thereby considered a related party pursuant to Chapter 16 of the Swedish Companies Act (SFS 2005:551), the so-called Lex Leo. If Erik Selin Fastigheter AB participates in the Directed Issue, this part of the share issue will be subject to approval by a subsequent general meeting. A valid resolution requires approval of at least nine-tenths of both the votes cast and the shares represented at the general meeting.

In connection with the Directed Issue, the Company has agreed to a lock-up undertaking, with customary exceptions, on future share issuances for a period of 90 calendar days after the settlement date of the Directed Issue.

Advisors

Nordea and Swedbank are Joint Global Coordinators and Joint Bookrunners in connection with the Directed Issue. Setterwalls Advokatbyrå is legal advisor to K-Fastigheter and Roschier Advokatbyrå is legal advisor to the Joint Global Coordinators and Joint Bookrunners in connection with the Directed Issue.

For more information, please contact:
Jacob Karlsson, CEO,
e-mail: jacob.karlsson@k-fastigheter.se, telephone: +46 (0)738-219 626

Martin Larsson, Deputy CEO/CFO
e-mail: martin.larsson@k-fastigheter.se, telephone: +46 (0)703-533 160

Johan Hammarqvist, Head of Investor Relations and Communications
e-mail: johan.hammarqvist@k-fastigheter.se, telephone: +46 (0)708-730 900
 

This disclosure contains information that K-Fast Holding AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the above contact persons, on 28 September 2023, 17:31 CEST

Forward-looking statements

THIS PRESS RELEASE INCLUDES FORWARD-LOOKING STATEMENTS. THESE STATEMENTS INVOLVE RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY, INCLUDING, BUT NOT LIMITED TO, WHETHER THE COMPANY WILL OFFER THE SHARES, THE ANTICIPATED CONDITIONS OF THE OFFERING, WHETHER THE COMPANY WILL BE ABLE TO CONSUMMATE THE OFFERING, THE FINAL TERMS OF THE OFFERING, THE SATISFACTION OF CUSTOMARY CLOSING CONDITIONS WITH RESPECT TO THE OFFERING OF THE SHARES, PREVAILING MARKET CONDITIONS, THE ANTICIPATED USE OF THE NET PROCEEDS OF THE OFFERING OF THE SHARESAND THE IMPACT OF GENERAL ECONOMIC, INDUSTRY OR POLITICAL CONDITIONS. FORWARD-LOOKING STATEMENTS MAY BE IDENTIFIED BY THE USE OF THE WORDS “MAY,” “WILL,” “EXPECT,” “INTEND,” AND OTHER SIMILAR EXPRESSIONS. THESE FORWARD- LOOKING STATEMENTS ARE BASED ON ESTIMATES AND ASSUMPTIONS BY THE COMPANY’S MANAGEMENT THAT, ALTHOUGH BELIEVED TO BE REASONABLE, ARE INHERENTLY UNCERTAIN AND SUBJECT TO A NUMBER OF RISKS. ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE ANTICIPATED OR PREDICTED BY THE COMPANY’S FORWARD-LOOKING STATEMENTS. PROSPECTIVE INVESTORS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE HEREOF. ALL FORWARD-LOOKING STATEMENTS ARE QUALIFIED IN THEIR ENTIRETY BY THIS CAUTIONARY STATEMENT, AND THE COMPANY UNDERTAKES NO OBLIGATION TO REVISE OR UPDATE THIS PRESS RELEASE TO REFLECT EVENTS OR CIRCUMSTANCES AFTER THE DATE HEREOF, EXCEPT AS REQUIRED BY APPLICABLE LAW.

Disclaimers

NO ACTION HAS BEEN TAKEN BY THE COMPANY, NORDEA OR SWEDBANK OR ANY OF THEIR RESPECTIVE AFFILIATES THAT WOULD PERMIT AN OFFERING OF THE SHARES OR POSSESSION OR DISTRIBUTION OF THIS PRESS RELEASE OR ANY OFFERING OR PUBLICITY MATERIAL RELATING TO THE SHARES IN ANY JURISDICTION WHERE ACTION FOR THAT PURPOSE IS REQUIRED. PERSONS INTO WHOSE POSSESSION THIS PRESS RELEASE COMES ARE REQUIRED BY THE COMPANY AND NORDEA AND SWEDBANK TO INFORM THEMSELVES ABOUT, AND TO OBSERVE, ANY SUCH RESTRICTIONS.

THIS PRESS RELEASE IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, ITS TERRITORIES OR ITS POSSESSIONS (COLLECTIVELY, THE “UNITED STATES”), AUSTRALIA, CANADA, HONG KONG, JAPAN, NEW ZEALAND, SINGAPORE, SOUTH AFRICA, SOUTH KOREA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL. THIS PRESS RELEASE IS NOT AN OFFER TO SELL SECURITIES OR THE SOLICITATION OF ANY OFFER TO BUY SECURITIES, NOR SHALL THERE BE ANY OFFER OF SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SALE WOULD BE UNLAWFUL.

THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES AND MAY NOT BE OFFERED, SOLD, PLEDGED, TAKEN UP, EXERCISED, RESOLD, RENOUNCED, TRANSFERRED OR DELIVERED, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES. THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN APPROVED, DISAPPROVED OR RECOMMENDED BY THE U.S. SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION IN THE UNITED STATES OR ANY OTHER U.S. REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THE OFFERING OF THE SECURITIES REFERRED TO HEREIN. NO PUBLIC OFFERING OF SECURITIES IS BEING MADE IN THE UNITED STATES.

THIS PRESS RELEASE AND THE OFFERING WHEN MADE ARE ONLY ADDRESSED TO, AND DIRECTED IN, THE UNITED KINGDOM AND MEMBER STATES OF THE EUROPEAN ECONOMIC AREA (THE “EEA”) AT PERSONS WHO ARE “QUALIFIED INVESTORS” WITHIN THE MEANING OF THE PROSPECTUS REGULATION (“QUALIFIED INVESTORS”). FOR THESE PURPOSES, THE EXPRESSION "PROSPECTUS REGULATION" MEANS REGULATION (EU) 2017/1129 AND REGULATION (EU) 2017/1129 AS IT FORMS PART OF UNITED KINGDOM DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 (THE “EUWA”).

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended (”MiFID II”); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the ”MiFID II Product Governance Requirements”), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any ”manufacturer” (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the shares in THE COMPANY have been subject to a product approval process, which has determined that such shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II (the “POSITIVE Target Market”); and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II. Notwithstanding the Target Market Assessment, Distributors should note that: the price of the shares in THE COMPANY may decline and investors could lose all or part of their investment; the shares in THE COMPANY ARE NOT ATTRIBUTED TO ANY guaranteed income and no capital protection. an investment in the shares OF THE COMPANY is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom (the “NEGATIVE Target Market”). The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the DIRECTED Issue. Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Managers will only procure investors who meet the criteria of professional clients and eligible counterparties.

FOR THE AVOIDANCE OF DOUBT, THE TARGET MARKET ASSESSMENT DOES NOT CONSTITUTE: (A) AN ASSESSMENT OF SUITABILITY OR APPROPRIATENESS FOR THE PURPOSES OF MIFID II OR UK MIFIR; OR (B) A RECOMMENDATION TO ANY INVESTOR OR GROUP OF INVESTORS TO INVEST IN, OR PURCHASE, OR TAKE ANY OTHER ACTION WHATSOEVER WITH RESPECT TO THE SHARES.

EACH DISTRIBUTOR IS RESPONSIBLE FOR CONDUCTING ITS OWN TARGET MARKET ASSESSMENT IN REGARDS TO THE COMPANY’S SHARES AND DECIDING ON APPROPRIATE DISTRIBUTION CHANNELS.

IN THE UNITED KINGDOM, THIS PRESS RELEASE IS BEING DISTRIBUTED ONLY TO, AND IS DIRECTED ONLY AT, QUALIFIED INVESTORS (I) WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE “ORDER”) AND QUALIFIED INVESTORS FALLING WITHIN ARTICLE 49(2)(A) TO (D) OF THE ORDER, AND (II) TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS “RELEVANT PERSONS”). THIS PRESS RELEASE MUST NOT BE ACTED ON OR RELIED ON (I) IN THE UNITED KINGDOM, BY PERSONS WHO ARE NOT RELEVANT PERSONS, AND (II) IN ANY MEMBER STATE OF THE EEA, BY PERSONS WHO ARE NOT QUALIFIED INVESTORS.

This press release does nEITHER identify Nor suggest to identify risks (direct or indirect) that may be associated with an investment in the NEW SHARES. ANY DECISION TO ACQUIRE OR SUBSCRIBE FOR SHARES SHOULD BE MADE ONLY ON THE BASIS OF AN INDEPENDENT REVIEW BY A PROSPECTIVE INVESTOR OF THE COMPANY'S PUBLICLY AVAILABLE INFORMATION. NEITHER NORDEA, SWEDBANK NOR ANY OF THEIR RESPECTIVE AFFILIATES ASSUMES ANY LIABILITY ARISING FROM THE USE OF, OR MAKES ANY REPRESENTATIONS REGARDING THE ACCURACY OR COMPLETENESS OF, THIS PRESS RELEASE OR THE COMPANY'S PUBLICLY AVAILABLE INFORMATION.

This press release does not constitute an invitation to warrant, subscribe, or otherwise acquire or transfer any securities in any jurisdiction. This press release does not constitute a recommendation for any investors' decisions regarding the Offering. Each investor or potential investor should conduct a self-examination, analysis and evaluation of the business and information described in this press release and any publicly available information. The price and value of the securities can decrease as well as increase. Achieved results do not provide guidance for future results. Neither the contents of the Company's website nor any other website accessible through hyperlinks on the Company's website are incorporated into or form part of this press release.

NORDEA AND SWEDBANK ARE ACTING ON BEHALF OF THE COMPANY AND NO ONE ELSE IN CONNECTION WITH THE DIRECTED ISSUE AND WILL NOT BE RESPONSIBLE TO ANY OTHER PERSON FOR PROVIDING THE PROTECTIONS AFFORDED TO CLIENTS OF NORDEA AND SWEDBANK OR FOR PROVIDING ADVICE IN RELATION TO THE DIRECTED ISSUE.

EACH OF THE COMPANY, NORDEA AND SWEDBANK AND THEIR RESPECTIVE AFFILIATES EXPRESSLY DISCLAIMS ANY OBLIGATION OR UNDERTAKING TO UPDATE, REVIEW OR REVISE ANY STATEMENT CONTAINED IN THIS PRESS RELEASE WHETHER AS A RESULT OF NEW INFORMATION, FUTURE DEVELOPMENTS OR OTHERWISE.

As a property company, K-Fastigheter’s objective is to add value for tenants by creating attractive homes with superior comfort. The Group’s operations encompass active property management, project development and proprietary construction operations. To enhance cost efficiency and cut construction times, K-Fastigheter has chosen to work with three concept buildings, developed in-house and constructed for proprietary management. K-Fastigheter provides some 4,000 homes in several locations in the Öresund region, in the province of Småland and in western Sweden, and is assessing new markets as production capacity increases. The Group’s property portfolio has a book value SEK 14,3 billion, with an annual rental value of about SEK 528 million. Since November 2019, the company’s Class B shares have been traded on Nasdaq Stockholm under the (ticker: KFAST B). Read more at k-fastigheter.com